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The Impact of Corporate Bond Issuance on Firms’ Performance: Evidence from Chinese Listed Companies

Xie, Jingliu LU and Cao, Yongjing LU (2017) NEKP03 20171
Department of Economics
Abstract
In recent years, Chinese corporate bond markets have grown at a remarkable rate. This thesis aims to examine the impact of corporate bond issuances on the momentum of stock prices by applying the event study. Our study comprises 212 corporate bond samples in the Chinese bond market from 2012 to 2016. Additionally, we investigate whether firm-specific and bond-specific characteristics correlate to the cumulative abnormal return by employing the cross-sectional regression. The result shows a positive cumulative abnormal return, which reveals the favourable signalling effect of bond issuance. Furthermore, we find that R&D expenses and size of issuance are positively related to the cumulative abnormal return. In contrary, insider ownerships,... (More)
In recent years, Chinese corporate bond markets have grown at a remarkable rate. This thesis aims to examine the impact of corporate bond issuances on the momentum of stock prices by applying the event study. Our study comprises 212 corporate bond samples in the Chinese bond market from 2012 to 2016. Additionally, we investigate whether firm-specific and bond-specific characteristics correlate to the cumulative abnormal return by employing the cross-sectional regression. The result shows a positive cumulative abnormal return, which reveals the favourable signalling effect of bond issuance. Furthermore, we find that R&D expenses and size of issuance are positively related to the cumulative abnormal return. In contrary, insider ownerships, special provisions of bonds, as well as firm size affect the stock reaction negatively. (Less)
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author
Xie, Jingliu LU and Cao, Yongjing LU
supervisor
organization
course
NEKP03 20171
year
type
H2 - Master's Degree (Two Years)
subject
keywords
Corporate Bond, Cumulative Abnormal Return, Event Study, Determinants
language
English
id
8912021
date added to LUP
2017-06-13 14:45:43
date last changed
2017-06-13 14:45:43
@misc{8912021,
  abstract     = {In recent years, Chinese corporate bond markets have grown at a remarkable rate. This thesis aims to examine the impact of corporate bond issuances on the momentum of stock prices by applying the event study. Our study comprises 212 corporate bond samples in the Chinese bond market from 2012 to 2016. Additionally, we investigate whether firm-specific and bond-specific characteristics correlate to the cumulative abnormal return by employing the cross-sectional regression. The result shows a positive cumulative abnormal return, which reveals the favourable signalling effect of bond issuance. Furthermore, we find that R&D expenses and size of issuance are positively related to the cumulative abnormal return. In contrary, insider ownerships, special provisions of bonds, as well as firm size affect the stock reaction negatively.},
  author       = {Xie, Jingliu and Cao, Yongjing},
  keyword      = {Corporate Bond,Cumulative Abnormal Return,Event Study,Determinants},
  language     = {eng},
  note         = {Student Paper},
  title        = {The Impact of Corporate Bond Issuance on Firms’ Performance: Evidence from Chinese Listed Companies},
  year         = {2017},
}